Borrowing starts to rise

Consumers borrowed 4.34bn during the month through a combination of store and credit cards, second charge mortgages, motor finance and in-store credit, the Finance and Leasing Association said yesterday.

The figure was one per cent higher than for November 2008, making it the first time this area of lending has seen annual growth since April 2008.

The sector has been hit hard by the recession and the credit crunch, as consumers have tightened their belts and lenders have faced higher funding costs.

Within the total, car finance saw the biggest year-on-year increase, rising by 36 per cent to 936m, as consumers took advantage of the Government's scrappage scheme.

There was also a four per cent rise in in-store credit, such as hire purchase agreements.